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The biggest unpunished heist in human history - Max Keiser


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Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Off Topic

Why a future planning agency

By 1985, after decades of sizzling economic growth, they had the highest per capita income on earth, the lowest gap between the rich and poor in any developed nation and a very healthy natural environment. They also were the greatest creditor nation on earth, having supplied cars, electronics and other goodies to the rest of the planet often in exchange for IOUs.

Benjamin Fulford In 1985 the US government set out to destroy this system out of what I can only describe jealousy and fear of being over-taken. George Bush Sr., then vice-president, ordered Japan to dismantle this system and hand economic control over to American oligarchs (gangsters). When the Japanese refused, they shot down Japan airlines flight 123 on August 12, 1985. On September 22nd, 1985, Japan signed the Plaza Accord that signaled the beginning of the systematic destruction of the Japanese economic system. Since then, Japan’s economy has been looted to the tune of about $5 trillion by American and European gangster oligarchs.




Two Judges Who Get It About Banks

The couple scrambled to do what Wells Fargo required: fax a copy of a certified check to one office and send it by overnight mail to another. The next day, the bank foreclosed anyway. Freddie Mac bought the Holms’ 5.5-acre property.

Back to back losses for Wells Fargo...

Holm v. Wells Fargo

In Re: Franklin v. Wells Fargo

Gretchen Morgenson NY Times Lawyers in the Missouri case and the New York matter contended that Wells had moved to foreclose on both properties even though the bank had no proof that it possessed the notes underlying the mortgages. This is a common and often persuasive argument, given the documentation failures that were rife in the mortgage industry.

Gregory Leyh, a lawyer in Gladstone, Mo., who represented the Holms, said: “This is a family that was trying to do everything right to keep their house. When you pit a family in financial distress against a powerful company that wants to make a few more dollars in a foreclosure, I think that’s pretty egregious.”

Court Turns Jaundiced Eye on Wells Fargo Robo-Mischief

Wells Fargo lacked standing to assert a claim pursuant to a Note secured by a Deed of Trust, where a forged indorsement in blank did not give it “holder” status under applicable Texas law.

In Re: Franklin v. Wells Fargo

National Consumer Bankruptcy Rights Center Under Texas law, an indorsement is presumed to be valid but that presumption may be overcome by “the introduction of sufficient evidence so that a reasonable trier of fact in the context of the dispute could find in the defendant’s favor.”

There was no evidence that the indorsement in blank was generated anywhere but within the walls of Wells Fargo to give it entitlement to enforce the Note.

In Re: Franklin: Federal Judge Slams Wells Fargo For “Document Practices”

We have all, unfortunately, become far to numb to the widespread document manufacturing that is occurring across this nation in the context of foreclosure proceedings.

The basis for the numbness is the widespread disregard to these issues articulated by trial and appellate court judges. The rule articulated again and again, in courtrooms all across this country is…


Think about that for a moment and let it sink in…..in context, this can be stated:

Weidner Law We have clearly gone way too long down a path from which we cannot recover.

But just read this detailed opinion and understand just how much trouble this judge has with this issue:

(“[I]n light of [claimant’s] admission that it fabricated the Allonge, and in the absence of any credible explanation for the difference of the Original from other filed versions of the Note, the Court will not apply the usual evidentiary presumptions to the validity of the Endorsements.”).

It is not clear that Mr. Kennerty fully understood the legal consequences of signing these documents.

Frankly, it does not appear that he understood the difference between preparing legitimate assignments and indorsements by Wells Fargo and improper assignments and indorsements to Wells Fargo.






We can't get enough of this story...

NY Federal judge slams Wells Fargo for forged mortgage docs

Judge Robert Drain has a message for Wells Fargo: “Forged” foreclosure documents don’t cut it in New York’s federal courts.

“… [T]he blank indorsement, upon which Wells Fargo is relying, was forged,” wrote Drain in a stinging rebuke to the bank. “Nevertheless it does show a general willingness and practice on Wells Fargo’s part to create documentary evidence, after-the-fact, when enforcing its claims, WHICH IS EXTRAORDINARY,” wrote Judge Drain with emphasis.

NY Post Drain casts a harsh eye on Kennerty’s statements about his work as a manager heading up a “default documents” department for Wells Fargo at the time of Franklin’s foreclosure.
Kennerty admitted to signing between 50 and 150 original documents each day related to administration and enforcement of Wells’ defaulted loans, according to the ruling.
Drain added: “Moreover, Mr. Kennerty’s testimony does not stop at describing manufactured mortgage assignments. He also testified that his ‘assignment team’s’ duties were not limited to processing assignments, including, when determined necessary, creating them; in addition, the ‘assignment team’ included people tasked with endorsing notes.

Wells Fargo Skewered by Federal Judge For Forgery as a Pattern of Conduct

Living Lies It should come as no surprise that a New York Federal Bankruptcy Judge issued a 30 page opinion that essentially said what people have been saying since 2007 — the entire foreclosure process is an exercise in illegal patterns of conduct to the detriment of the homeowners.

From 2008: Jury gives woman $1.25M in lawsuit over mortgage

A six-member jury convicted Wells Fargo of fraud, negligence and other charges

Thomas, 41, said that her case "destroys the myth" that the subprime mortgage meltdown is fueled by homebuyers taking loans they can't handle.

"They make it seem like it's the person's fault, but they don't know what's going on behind the scenes."


Business Journal  

 Eli Segall

Roughly two to three weeks later, her loan agent submitted the application with a string of incorrect information, according to court documents. This included the Social Security number of Thomas' sister, who had a higher credit rating; a monthly income of $14,000, which was nearly double Thomas' actual income; and assets that included $30,000 cash at Constellation Federal Credit Union. According to the suit, Thomas never claimed to have this much money socked away, at Constellation or elsewhere.
Thomas soon learned that her loan was at 10.625 percent interest, with a monthly payment of roughly $4,600, well above the $3,000 she was expecting. She signed the contract anyway, at the urging of her attorney at the time, figuring it was an honest mistake and Wells Fargo would correct it.


Foreclosure REVERSED! Error to Admit Hearsay Over Foreclosure Attorney Objections!

At the end of the day, whether a homeowner is permitted to stay in their home or whether they are thrown into a street…often by a plaintiff who is several times removed from the actual party whose name is on the paper

Holt v. Calchas

When the first opinion in Holt was released, the trial court was largely affirmed. But on rehearing, a completely different outcome was produced….this time, the court dismissed. 

Weidner Law One of the most frustrating things we experience on a regular basis is the utter lack of enforcement of basic rules of evidence. The rules of evidence exist to protect all parties and to ensure the integrity of the judicial process as a whole. But what’s occurring across the board in foreclosure cases is a lack of enforcement of those rules. Documents that may or may not exist are simply created.

What of course is so incredible is this occurs on such a widespread basis….but I mean at least in those cases they are alerting the court to the fact that….



When Consumers Give Up Their Right to Trial in Financial Disputes

If you have a credit card or a checking account or use prepaid cards, there’s a good chance you have waived your constitutional rights. 

DealBook Constitutional rights are the most fundamental rights Americans enjoy. So you might think it would be hard to get people to give them up. But every day, people unknowingly surrender their constitutional rights, including a right mentioned in the Declaration of Independence. And if bank lawyers have their way, Americans will continue relinquishing such rights without even realizing it.



Anyone who is litigating a case where Ocwen is involved in any way in the chain of title or ownership of the loan paperwork should read this in detail. This could be used as support for arguments that the books and records of the servicer or foreclosing party should not be given the luxury of certain legal presumptions. 

Living Lies The presumption that there is in fact a servicing default called by the bondholders, may be enough to force the parties to actually prove the nonexistent transactions about which their assignments and endorsements are written.
Why? That is the question everyone should be asking. If Ocwen was not servicing for the benefit of the REMIC Trust (and the bondholders) then who are they really working for? Themselves?


(Banks are not transferring Notes - they are trading bits of data.)

"The far more likely inference, instead, is that when the loan was transferred to Wells Fargo, the Note with the blank ABN Amro indorsement did not exist."

In Re: Franklin

Wells Fargo has offered no explanation, let alone evidence, of who else, if not Wells Fargo, held the original of the Note with the blank ABN Amro indorsement before December 28, 2009, if, in fact, such a version then existed. 

The file provided by the transferor should have included it, if it did exist during that period, because Washington Mutual Bank, FA would not have been able to enforce the Note, either, without the blank indorsement, and the Assignment of Deed of Trust attached to the proofs of claim states that both the Note and Deed of Trust were transferred to MERS as nominee for Washington Mutual Bank, FA on June 20, 2002, effective November 16, 2001.  In other words, why would only an outdated and unenforceable version of the Note have been logged in by Wells Fargo when it took over the file in February 2007 if the only enforceable version of the Note had in fact existed at that time (and should have existed since 2002)?


Last-ditch foreclosure hearings draw hundreds to Detroit

The homeowners nearly filled a long conference room in Detroit's Cobo Center while waiting for their cases to be heard. Many hoped to work out payment plans to ease their tax debts under new laws signed this month by Gov. Rick Snyder.

Detroit Free Press "Everybody does have a story. Most of them are probably true, because you couldn't make them up if you try," said Eric Sabree, Wayne County's deputy treasurer of land management. Officials expect more than 14,000 property owners to seek help over seven days of hearings that run through Feb. 6.

"One of the reasons why we want people to stay in their homes is because when they become abandoned, they get stripped. They become a crime scene. They become a drug house," Sabree said. "It's better to let the person stay in the house and collect taxes even if it takes longer to collect the money."


Woman claims law firm unlawfully filing debt complaints

West Virginia Record According to the complaint, in April 2014, Atkins & Ogle filed a civil complaint against Lewis for Jefferson Capital Systems, a debt collector, to whom Lewis allegedly owes money. The complaint states Atkins & Ogle often files suit, on behalf of debt collectors without standing, such as Jefferson, who purchase charged-off consumer debt, against consumers not sophisticated enough to defend themselves in court, with the knowledge that no evidence of such debt exists.


US investigates Deutsche Bank foreclosure case

* Allegations Deutsche Bank filed false documents

* Inquiry could affect foreclosures across United States

* Testimony demanded from Deutsche Bank officials

Reuters Although the investigation involves the case of only one homeowner in Connecticut, a court document filed on Jan. 26 by the United States Trustee's Office said it wants to elicit information about Deutsche Bank's practices in general in foreclosure cases.

In recent months, the U.S. Trustees' Office has stepped up efforts around the United States to block banks and law firms from using false or fabricated documents in home foreclosure actions. The effort follows disclosures in October 2010 of large-scale "robo-signing", the mass signing of foreclosure affidavits containing "facts" that had never been checked, and wide production of false mortgage assignments.


Risky mortgage bonds are back seven years after the U.S. housing crisis – just don’t call them subprime

Financial Post Investment firms are looking to revive the market without repeating the mistakes that fueled the U.S. housing crisis last decade, which blew up the global economy. This time, they will retain the riskiest stakes in the deals, unlike how Wall Street banks and other issuers shifted most of the dangers before the crisis. Seer Capital and Angel Oak prefer the term “nonprime” for lending that flirts with practices that used to be employed for debt known as subprime or Alt-A.


Court OKs Suits Over Denied Mortgage Modifications

Previously, courts were dismissing claims by borrowers with valid mortgage modification claims on the theory that HAMP preempts state law contractual and other claims, but the decision has put that rationale to rest, Chang said.

Arias v. Elite Mortgage Group

New Jersey Law Journal Homeowners who enter into trial agreements to modify their mortgages under the federal Home Affordable Modification Program (HAMP) and comply with the terms can sue for breach of contract if a modification is denied and might even have a consumer fraud claim, a New Jersey appeals court has held in a precedential decision of first impression.
“While there are no reported New Jersey cases addressing the contractual status of a [Trial Period Plan] Agreement, case law suggests that an agreement that purports to bind a debtor to make payments while leaving the mortgage company free to give her nothing in return might violate the New Jersey Consumer Fraud Act,” Judge Susan Reisner

How corporate America is blocking $50 million from reaching Florida homeowners

Palm Beach Post So, coming up on two years, just 71 Florida homeowners have been enrolled in the Modification Enabling Pilot, and just $2 million of the $50 million has been spent.

Wall Street Regulation Needs to be Tougher, Americans Overwhelmingly Agree

Americans for Financial Reform Four-fifths of all voters express concern over the political influence of Wall Street and the financial industry, and more than half (55%) say they would be less likely to vote for a congressional candidate known to have received large donations from big banks and financial companies.


Homeowner had to prove the Note was lost or stolen. They did.

Dernier v. U.S. Bank

The question, then, is whether the Plaintiffs can sufficiently show that the note was lost or stolen so as to survive summary judgment. The court concludes that the Plaintiffs have made such a showing.

Vermont Superior Court


h/t Stop Foreclosure Fraud

The authenticity of this signature is disputed. The Plaintiffs have supplied an affidavit of a Chad M. Goodwin, stating that he was an employee of Mortgage Network, Inc. from 2000 to 2013, and that the signature superimposed over the stamp is not his signature.

Plaintiffs rely on § 3-305(c), which states that "an obligor is not obliged to pay the instrument if the person seeking enforcement of the instrument does not have the rights of a holder in due course and the obligor proves that the instrument is a lost or stolen instrument."


Different endorsements and versions of the Note

Tom Cox: Why we should not trust mortgage servicers and their lawyers. 

(highlighted in original version)

Sometimes I feel that the Committee operates in vacuum, drafting provisions that might make sense in a world where loan owners, their servicers and their lawyers act honestly and rationally, while in the real world of real foreclosure practice it is necessary to preserve safeguards against the constant misconduct of the servicers and their lawyers.

Tom Cox, Esq.


This case offers such a timely example of why I fight so hard in Committee meetings against changes in the law that presume any consistent degree of integrity in the mortgage servicing industry and any consistent degree of competency or professional diligence or care on the part of their lawyers. It is also why I fight so hard against any dilution of proof requirements for the servicers. I just had a case of my own sustained by the Maine Supreme Court on September 24, 2014 where the trial court entered judgment as a matter of law for my homeowner client after I forced the bank’s witness on cross examination to admit that the JPMorgan Chase loan payment history presented at trial was missing 44 monthly payments actually made by the homeowners.



Murphy's Law: Paperwork Errors Dog Lenders in Foreclosure Cases

It should have been a straightforward case, but a clerical error put Bank of America on the losing end of a four-year foreclosure case Wednesday.

The problem was the mortgage and all subsequent documents included an incorrect legal description of the condo.

dbr "It's about mistake upon mistake upon mistake," said Epstein's attorney Roy Oppenheim.

Court documents suggest the bank discovered the error in 2010 after the Broward County property appraiser's office rejected the certificate of title and refused to transfer title because the legal description didn't match the official record.

But attorneys say it took the bank two years (2 YEARS!) to move to fix the problem, leaving Epstein as the documented owner facing homeowner association bills.


Middle Class Getting Squeezed Out of Courts. So What is Being Done About it?

"I have seen a lot of working middle class litigants in court without attorneys," she said. "Where they might have had a neighborhood attorney representing them before, now they are in court alone... 


Law Reader

... Somewhere the wheels have fallen off the bus for the working middle class."

There is nothing more heartbreaking than to have a foreclosure case, and the bank's lawyer comes in all polished, well-dressed, and he knows exactly what to do, and you see a husband and wife all by themselves with a file. As a judge, you can't say, 'This is what you have to do so I can rule in your favor,' but you want to."


Rent to Own: Wall Street’s Latest Housing Trick

And it's easier to evict because the occupant has only a rental agreement. It's not a foreclosure proceeding against an owner, after all.

ProPublica Shaashua delivered the kicker to the roomful of would-be investment managers: "Most times, given the reality, tenants do take it, but it's hard for them to execute the option," he said. "Our experience is that most stay until the end and then they say they cannot come up with the down payment or decide not to stay in the property."

Voila, free money. This amounts to an admission that the product exploits consumers' lack of financial savvy. This shouldn't be surprising. 








Missouri Court hammers Wells Fargo with $3 Million in damages for its outrageous conduct

Title quieted in the homeowners!

Plaintiffs were severely damaged; Wells Fargo took its money and moved on, with complete disregard to the human
damage left in its wake.

Judge R. Brent Elliott

Circuit Court of Clinton County Missouri

Wells Fargo and its agents expended immeasurable, if not incomprehensible, time and effort to avert reinstatement.
The result of Wells Fargo's egregious conduct was to impose approximately six and one-half years of uncertainty, lost optimism, emotional distress, and paralysis on Plaintiffs' family.

The Court finds Defendant Wells Fargo's attitude toward Plaintiffs unfathomable. The incredible effort made by Plaintiffs to keep the property they so clearly love
should have been commended, not condemned. Wells Fargo's decisions to renege on its promises and contract, and to deceive Plaintiffs with the pledge to cancel the foreclosure sale, were outrageous and reprehensible.

Missouri Wrongful Foreclosure: Trial Court Awards over $3 Million Including Punitive Damages and Quiet Title

This case finds that neither the GSE nor anyone else in the chain had the power to enforce the paper because they did not really have ownership of the loan, that their title was false, that quiet title is granted to plaintiffs, that foreclosure was wrongful, that compensatory damages are awarded and that punitive damages would be awarded.

Living Lies Courts are no longer looking the other way on intentionally sloppy foreclosures that cover up a larger fraud on investors. The courts are not clear on how that occurred, partially because nobody has been allowed to present it, but they have enough of a feel of the situation to see that there is something fundamentally wrong with the mortgage origination and foreclosure practices.

By implication, the courts are saying the debt has no paper that applies and that therefore nobody should be allowed to enforce the paper. It is close to declaring the mortgage void ab initio.


Foreclosure echo

Former homeowners face huge insurance claims

The lawyer represented a mortgage insurance company Galindo had been paying premiums to for years. He’d never given his insurance policy much thought – it was just something he had to buy to qualify for a mortgage since he couldn’t afford a big down payment. He thought it would help him if he got in a bind.
Too late, Galindo realized that the policy only protected the bank, and nothing prevented the insurer from coming after him for losses related to the foreclosure on his home.

Jenifer McKim


All his savings, scraped together over years delivering medicine for local pharmacies, were gone, along with the home he bought in 2005 for $410,000. Devastated, the 54-year-old immigrant, along with his wife and three-year-old daughter, packed their belongings and moved into a small apartment, hoping to rebuild.
But that hope evaporated in a matter of months, when Galindo received a letter from a lawyer claiming he owed $136,547 on the family home he’d left behind.

"It is just knocking people when they are down, particularly when we live in a world where there were so many bad mortgages made." —Ira Rheinold


Ocwen and Bondholders Clash Over Mortgage Services

The embattled subprime mortgage servicer Ocwen Financial is accusing a group of mortgage-bond investors of pushing for fast foreclosure and objecting to principal reductions on billions of dollars in mortgages.

DealBook The criticism comes after the bondholders released a statement late on Friday complaining that Ocwen had failed to adequately service mortgages. 

In a letter to the bondholders’ lawyer, Ocwen’s lawyer Richard A. Jacobsen said the group’s “ultimate objective” was to “stop servicers from modifying loans and force them to foreclose on and evict as many homeowners as quickly as possible.

(Since it opened in the 1980's, Ocwen's business model is to foreclose and evict - not 'service'. Servicing provided the keys to the vault. - MSF)


Insurers Pay Pretender Lenders and Then Pursue Homeowner for the “Loss”

If you ask the banks about these payments you get stonewalled. And depending upon the timing of the payment it might invalidate the claim of a default, a notice of default and notice of sale. It could also negate the right to foreclose — again depending upon the timing of the payment.

Living Lies The take away here is that in a huge number of cases there are or were third party payments that reduced the alleged loss of the creditor or alleged creditor AND depending upon when those payments were made if might have the effect of rendering a notice of default void or even a foreclosure judgment where the redemption rights of the homeowner were affected by an incorrect statement of the loss. In actions for deficiency, the insurers are essentially cherry picking cases in which they think the borrower can pay the alleged loss. It also might represent an overpayment.

Big mortgage investors take first step toward suing Ocwen

Can anyone name a servicer that hasn't failed to properly collect payments? MSF

Reuters Major mortgage bond investors including BlackRock, MetLife and Pimco on Friday took a first step toward suing Ocwen Financial Corp, accusing it of having failed to properly collect payments on $82 billion of home loans, according to documents.


How subprime loans exploded

Detroit Free Press Morgan Stanley, like other big Wall Street firms, pooled such mortgages and sold them to investors for lucrative fees. To make these pools of risky mortgages seem safer, they promoted the idea that these mortgage-backed securities were first-rate investments. Credit rating agencies contributed to the problem by rating these securities credit-worthy no matter how weak the underlying mortgages.

The question before the court is answered by its own summary.

California Foreclosure Law: California Supreme Court Grants Review Of The Keshtgar Decision

CFLA The grant of review in Yvanova is limited to a single issue: “In an action for "wrongful" foreclosure on a deed of trust securing a home loan, does the borrower have standing to challenge an assignment of the note and deed of trust on the basis of [defects] allegedly rendering the assignment [void]?



Gibbs-Bruns Today, the Holders of 25% Voting Rights in 119 Residential Mortgage Backed Securities Trusts (RMBS) with an original balance of more than $82 billion issued a Notice of Non-Performance (Notice) to BNY Mellon, Citibank, Deutsche Bank, HSBC, US Bank, and Wells Fargo, as Trustees, Securities Administrators, and/or Master Servicers, regarding the material failures of Ocwen Financial Corporation (Ocwen) as Servicer and/or Master Servicer, to comply with its covenants and agreements under governing Pooling and Servicing Agreements (PSAs).





Wall Street's Achilles Heel may be hidden in plain sight

As these boardroom and courtroom battles play out, millions of distressed home owners' lives have been ripped apart: upset, stressed, their health and well being threatened, marriages dissolved and families splintered. 

Using existing law, we can legally and peacefully share in that redistributed wealth, collectively, with all who can muster the political will to organize and take action to recover what has been stolen. We'll have law on our side. But for how long? I'm sure there is a lot of pressure from Wall Street to get those damn laws changed retroactive to 1990.

Millions of mortgage notes may have been faked. The claims of their "alleged" owners are worthless. The perpetrators of the scheme are long gone and beyond the arm of the law. Too big to fail. Too big to nail. Maybe, but why pay them again?

David Petrovich


What if the "evidence" needed to establish the (alleged) lenders' demand for repayment, was faked? Counterfeited. Never existed. Cooked up and then presented as lawful "evidence" of 1) the proof of debt, and 2) proof of the rights required by law to collect that debt. That just isn't right! Or legal. If we pretty much can agree our economic and political systems are rigged by Wall Street interests, how can we - who barely keep roofs over our heads - mount a successful challenge against an enormous foe to stop all mortgage foreclosures and then move to recover our homes and lost equity? And how are we to do that if its rigged against us from the start? How? I propose the Re-Redistribution of Housing Wealth In America Program.

The toxic notes can and must be identified and then like a cancerous tumor in an otherwise healthy body, excised. Extinguished. This "cure" will require our political will, and judicial enforcement. We can put our political will to use right away by democratically forming and then empowering groups whose initial and sole purpose is to wage a very fair and legal warfare against foreclosure based on Wall Street's shaky claims. Claims supported by shaky, if not fraudulent evidence. We can use current Law to condemn toxic mortgage notes house by house, neighborhood by neighborhood, city by city, and state by state.



The Complaint really breaks down exactly what the scam of MERS is, and it does so with a level of clarity and certainty the likes of which I have rarely seen. 

As will be demonstrated herein, the unregistered and unregulated securities deals and trades conducted behind the veil of MERSCORP, masquerading as Mortgage Electronic Registration Systems, Inc. in its third iteration, as MERS III, are not even supervised by MERSCORP for compliance with its own “Rules” purporting to create the common agency, by which millions of homes have been liquidated upon claimed defaults which did not actually occur.


Liberty Road Media The claimed “defaults” were almost always covered by mortgage insurance, credit default swaps and funds made available by Congress through the Troubled Asset Relief Program (TARP) funds, along with the Quantitative Easing (QE) programs (QE I, QE 2 and QE 3) operated by the Federal Reserve System, and were paid multiple times upon purported defaults engineered by CREDIT SUISSE and other members of the US Dollar LIBOR Panel in order to collect on multiple secondary payment systems established at the time of the unregistered securities offerings.

r. The proceeds of the ultimate foreclosure liquidations of United States homes under the MERS®-LPS RACKETEERING ENTERPRISE, in excess of the payments obtained from private mortgage insurance, unsubrogated credit default swaps, TARP funds, and QE payments are paid to the “servicers” who initiated the foreclosure process to obtain the bonus payment for liquidating this nation’s homes for defaults already cured by multiple payments.” p.11


The bank’s failure to comply is a defense to foreclosure!

Take a look at your monthly mortgage payment. If you see a line every month that says, “FHA”, that means that every single month, you are making an insurance policy premium payment for FHA insurance. 

Weidner Law What does that insurance provide? It provides that banks MUST work with borrowers prior to filing a foreclosure…..
GOAL. The Congress has adopted a national housing goal expressed as “a decent home and a suitable living environment for every American family”.


Ocwen Financial Keeps California Mortgage License, Sued By Large Bondholders

Had Ocwen lost its mortgage license in California, the sanction would impact 378,132 loans that the company services in the state

Forbes BlueMountain Capital disclosed it was shorting the stock of Ocwen Financial and one of its publicly traded affiliates Home Loan Servicing Solutions. The hedge fund also delivered a notice of default against a receivables trust that is a key funding source for Ocwen, battering shares of both Ocwen and HLSS.

BlueMountain believes that regulatory sanctions against Ocwen have put some of the RMBS trusts it services in position of default. As a result, the hedge fund has bought what it believes are defaulted notes, and shorted both the stock of Ocwen and HLSS.


Corporate creditors want Bill Erbey to pay his $925M debt

Home Loan Servicing Solutions, an affiliate of Ocwen Financial, admitted to “imprudent” mortgage servicing practices.

New York Post Mortgage-service mogul Bill Erbey made millions of dollars over his career collecting mortgage debt — but now his corporate creditors are calling for him to pay up.
Hedge fund BlueMountain Capital on Friday claimed tussles between Erbey’s various companies and regulators placed Erbey company debt in default.


Fund Manager's Letter to Bondholders Detailing Sins of Ocwen

The facts establishing these Events of Default are irrefutable. For example, Ocwen recently "stipulate[d]" and "agree[d]" in a consent order with the New York Department of Financial Services to violations of law and to engaging in imprudent servicing practices.

Blue Mountain Capital press release  In addition, the California Department of Business Oversight has commenced proceedings to suspend Ocwen's servicer license in California, a significant source of loans in the RMBS trusts that generate the advances that collateralize the payments to Noteholders. These (and other) agencies' findings and enforcement actions demonstrate Ocwen's systemic, long-standing and continuing servicing failures and disregard of applicable and analogous laws. Evidencing the significance of these affirmations of Ocwen's servicing misconduct, the rating agencies expressly referenced the state regulatory authorities' actions as a basis for their decisions to downgrade Ocwen's servicer rating and the corporate ratings of related entities, Ocwen Financial Corporation and Home Loan Servicing Solutions, Ltd. 


Ocwen Agrees to $2.5 Million Settlement for Failing to Provide Loan Information

California Department of Business Oversight The settlement also prohibits Ocwen from taking on any new California customers until the DBO determines the firm can fully respond in a timely manner to future requests for information, and the DBO will drop its effort to suspend Ocwen’s license to operate in California.


Professor Whitman on Foreclosing on E-Note

There are very few cases thus far involving foreclosures of mortgages securing e-notes, and little authority on exactly what the holder must prove in order to properly foreclose.

Good responded, challenging Wells
status as holder because the Note designated by Wells Fargo was not endorsed.

Unfortunately for Wells, the court found that its affidavit was woefully inadequate to establish Wells’ standing to foreclose the mortgage.

Good v. Wells Fargo

See 15 USC 7003 - Specific exceptions

Prof. Whitman


Indiana COA

In its reply, Wells Fargo asserted that, because the Note was an electronic note, “delivery, possession, and endorsement of an electronic promissory note are not required pursuant to federal statute.”

It is arguable that, if the note is electronic rather than paper, eSign overrides this conclusion by virtue of its express requirement of “reasonable proof.” And since the eSign Act is a federal statute, it is quite capable of preempting any contrary state legislation. On the other hand, the “reasonable proof” requirement only applies “if requested by a person against which enforcement is sought.” In a nonjudicial foreclosure proceeding, how would the borrower make such a request? These are interesting, but highly speculative questions.

Section 101 of the ESIGN Act, sub-section (b), preserves the rights of individuals to NOT USE electronic signatures.

Bye, Bye Mortgage

Stopa Law The banksters have now appealed, and so has the homeowner’s association, but I’m confident they’re both going to lose. To understand why, and follow the exceedingly unique fact pattern that gave rise to this mortgage elimination, take a look at the association’s Initial Brief, and the Answer Brief I just prepared. My brief sets forth the facts, but, again, do not try to duplicate this. You will fail. 


Can getting sick push you into foreclosure?

Washington Post Piles of research link foreclosure to depression, increased emergency room visits and even suicide among people who have lost their homes or are close to it. But just as foreclosures can contribute to health problems, new research shows that health problems can contribute to foreclosure, as well.


Genao v. Litton Loan Servicing

The Supreme Court (1) quashed the order denying MERS’ motion for a protective order, holding that Plaintiff lacked standing to challenge the assignment in question; and (2) affirmed the grant of summary judgment for Litton and Deutsche Bank, holding that MERS had the authority to assign the mortgage. 

Rhode Island Supreme Court

In DiLibero v. MERS the court wrote:  Mruk v. MERS, 82 A.3d 527, 534-36 (R.I. 2013). In Mruk, we held that “homeowners in Rhode Island have standing to challenge the assignment of mortgages on their homes to the extent necessary to contest the foreclosing entity’s authority to foreclose.” Id. at 536. We see no reason to veer from our holding in Mruk in this case.


Mixed Questions of Fact & Law Must Go to THE JURY 

Hana Financial v. Hana Bank

You MUST now argue that EQUITABLE TOLLING applies to the 3-yr SOL on TILA Claims; then ARGUE this is a mixed question of FACT & LAW under HANA

SCOTUS BINGO! You just got the RIGHT to invoke a JURY on whether there is "equitable tolling" of your TILA claim! 

Although claims of "equity" are decided by a judge "as a matter of law" -----whether your "FACTS" apply to the court's "equitable analysis" are for a JURY TO DECIDE FIRST!

DEMAND A JURY ON THE FACTS BEFORE THE JUDGE DECIDES THE EQUITABLE QUESTION! Jury verdicts are extremely difficult to get reversed and they usually want to rule for the homeowner not the BANKSTER.


Lawyers as Crime Enablers: Maine Bar Counsel Punts on Sanctioning Foreclosure Attorneys for Bogus Affidavits

Astonishingly, even though the office of Maine Bar Counsel had subpoena power to conduct investigations, it did absolutely nothing to investigate whether GMAC’s lawyer committed criminal acts by tampering with his affidavits by attaching exhibits to them after he signed them. They presented no evidence at all on this issue to the grievance panel. I testified at the grievance proceeding and was deeply disturbed by the poor quality of the presentations of the Bar Counsel lawyers. They were hopelessly outmatched by the high priced and highly experienced litigation lawyers hired by the lawyers from the GMAC firm.

The practice of law should be considered to be a privilege, reserved to those able and willing to conduct themselves with care, honesty and professionalism. 

Tom Cox, Esq. The profession must recognize that, just as a careless surgeon can kill or maim a patient, a careless or dishonest lawyer can injure a homeowner, or even hundreds of homeowners

Discipline should be severe. Once lawyers have licenses to practice, there should be no hesitation in suspending or revoking the licenses of lawyers who fail to conduct themselves in accordance with established rules of professional conduct. Lawyers should demand that the profession assess annual registration fees sufficient in amount for disciplinary authorities to pay highly competent lawyers to prosecute lawyers who abuse the legal system. In my opinion, the Maine lawyer disciplinarily system has failed miserably in this case. 

Pause and think about it for a moment: The lawyers who were directly responsible for the creation of the robo-signing scandal are not being held accountable for enabling it to occur. There has been no meaningful prosecution of criminal conduct of the bankers or servicers from federal or state prosecutors, and it is now apparent that there will be no disciplinary actions against their lawyers from bar discipline authorities. Senator Elizabeth Warren is right—the system is rigged against the little guys.


Shadow lenders fuel risk in Canada’s hot housing market

The Bank of Canada warned in December that the less regulated lenders pose financial risks

  Gerstel is part of an expanding industry of mortgage brokers and nonbank lenders who operate outside the reach of federal bank regulators. They’re thriving after Canada introduced a half-dozen mortgage rules since 2008 to cool its soaring home prices. While slowing the growth of traditional bank loans, the regulations have pushed new borrowers into an opaque market where nonbanks provide uninsured, short-term mortgages at interest rates as high as 20%.


Whistleblower: Pelosi Covered Up Role In Crisis

Subprime Scandal: We've long suspected the Financial Crisis Inquiry Commission wasn't honest in examining events before the meltdown. But an ex-commissioner says the probe was actually a full-blown political cover-up.

Investors The conspiracy helped protect some of the Democrats' biggest stars from scrutiny and accountability while helping justify the biggest government takeover of the financial sector since the New Deal.
Wallison reveals that the Democrat-led panel buried key data proving that the U.S. Department of Housing and Urban Development and other federal agencies pushed the housing market over the subprime cliff. The final FCIC report put the blame squarely on Wall Street.


Banks Brace for Pain: Statute of Limitations on TILA Rescission and TILA Claims

Since TILA does not evidence a contrary Congressional intent, it’s statute of limitations must be read to be subject to equitable tolling, particularly since the Act is to be construed liberally in favor of consumers.” Rotella v. Wood 528, 549, 560-61,120 S. Ct. 1075, 145 L. Ed. 2d 1047(2000).

Living Lies The strategy of the banks has been to wait out three years and then pursue foreclosure and when the borrower raises TILA defenses, the answer is that the statute of limitations has run. With the recent unanimous Supreme Court decision that effectively smacked thousands of lawyers and judges in the face for re-interpreting basic law and the specific and express provisions of TILA, this bank strategy should no longer work.

All those hundreds of thousands of letters sent back to borrowers saying their letter of rescission was not effective were wrong. Dead wrong. And all those foreclosures that happened anyway were wrongful and void. And THAT means that hundreds of thousands of homeowners who sent notices of rescission still own their homes even though on paper their homes were sold to third parties.


CFPB Takes Action Against Wells Fargo and JPMorgan Chase for Illegal Mortgage Kickbacks

Banks to Pay $35.7 Million After Loan Officers Illegally Traded Referrals for Cash and Marketing Services

COMPLAINT against Wells/Chase

CFPB The Consumer Financial Protection Bureau and the Maryland Attorney General took action against Wells Fargo and JPMorgan Chase for an illegal marketing-services-kickback scheme they participated in with Genuine Title, a now-defunct title company. Genuine Title gave the banks’ loan officers cash, marketing materials, and consumer information in exchange for business referrals.  



On April 30, 2014, Jones was deposed in the Wisconsin case of Deutsche Bank National Trust Company vs. Ray

Chase Deposition: Vermyrtis Jones

Liberty Road Media What do we discover in this testimony? Well, that Linda Tirelli was right—this is “business as usual for all the big banks”—at least as far as creating allonges, voiding existing endorsements, and/or creating new endorsements to take the place of existing ones (or to create endorsements that should have existed but didn’t). Thanks to Jones’ sworn testimony, apparently we can now add JPMorgan Chase to the list of banks that appear to do this type of thing.


Reverse mortgage scam targets elderly women

WGNTV Tears slowly roll down the face of 88-year-old Lillie Williams as she worries about losing her home of more than 40 years. I know I ain’t ready to give up my house. And 64-year-old Dorothy Pruitt holds her head in disbelief as she thinks about how much money she’s lost remodeling her home.


Florida: Proof of transaction IS required.

The 4th DCA has now come to the conclusion that the reason for robo-signing, fabrication, backdating, forgery etc. is that there was no transaction underlying the paperwork that the banks rely upon — at least in this case. 

Murray v. HSBC

Living Lies At least in the 4th DCA in Florida, foreclosing parties are being returned to the days when they had to prove the actual loan and prove that actual purchase of the loan through proof of payment for the transaction by the party seeking to enforce the loan. And when they don’t or can’t, they should be subjected to sanctions against both the conspirators and their attorneys, plus punitive damages.

There is an increasing number of Florida and other state and Federal decisions, including bankruptcy court, where they found the original note and mortgage void or the transfers to have eviscerated the right to enforce the mortgage through foreclosure. In short, the tide has turned.

Bharara: After Silver arrest, ‘stay tuned’ for more

In a line that might send a chill through certain corners of the Capitol, Bharara noted that his corruption work was ongoing.

Capitol Confidential “We will keep at it, because the men and woman of the FBI and of my office still subscribe to the quaint view that no one is above the law, no matter who you are, or who know, or how much money you have,” he said. “And so our unfinished fight against public corruption continues. You should stay tuned.”

Pa. homeowners file class action RICO suit against Bank of America

A class action suit accuses Bank of America of establishing an illegal racketeering scheme that allowed it to make millions in kickbacks while taking minimum risk as an investor in mortgage insurance companies.

Weiss v. Bank of America (RICO - Racketeering)

PA Record





Stop Foreclosure Fraud

In exchange for a steady stream of business, the mortgage insurance providers agree to share a percentage of the premiums.

Bank of America and its subsidiaries, are accused in the class action of conducting a pattern of wire fraud and racketeering activity under RICO statutes. The action seeks a declaratory judgment ruling the actions unlawful and full restitution of mortgage insurance premiums to members of the class.

It can happen. Judges can go to prison.

Third traffic court judge sentenced to federal prison

PA Legal Journal According to the original indictment, Philadelphia ward leaders, local politicians and associates of the Democratic City Committee regularly contacted the defendants seeking preferential treatment on specific tickets. Additionally, defendants were regularly contacted by family, friends, and associates seeking a “break” on tickets, it is alleged.

Low-income loans didn't cause the financial crisis

It was all planned two decades ago to transfer wealth. MSF

CBS News In the battle over whether too much or too little regulation of the financial sector played a role in causing and exacerbating the crisis, the evidence points away from those who claim overzealous government regulation was at fault.


SEC slaps Standard & Poor’s for ratings fraud

McClatchy Ratings agencies such as S&P and Moody’s Investors Service have been under the regulatory microscope for their role in assisting Wall Street banks with favorable ratings for residential mortgage bonds that were given the gold-plated AAA rating, only to go bust, soaking investors and nearly sinking the U.S. financial system in 2008.


New York Attorney General Adds to Lawsuit Over Barclays Dark Pool

DealBook New York State’s top law enforcer has claimed that Barclays made a false statement in court documents and that it defied subpoenas seeking the testimony of two executives, a move that builds on a previous lawsuit over the bank’s private stock trading platform.


Ocwen Adds New Directors with U.S. Treasury, FHLB Experience

Mortgage Servicing News Caldwell previously worked as chief of the Homeownership Preservation Office at the Treasury Department, where she oversaw foreclosure prevention initiatives through the TARP and provided oversight of housing market recovery efforts. She has also served as a community development banking executive at Bank of America.

Murray v. HSBC

Court: "In this foreclosure puzzle, one of the pieces is missing."

Put simply, HSBC failed to prove standing. Reversed and Remanded for entry of judgment in favor of appellants.

Florida Fourth District COA "A nonholder in possession, however, cannot rely on possession of the instrument alone as a basis to enforce it. The transferee does not enjoy the statutorily provided assumption of the right to enforce the instrument that
accompanies a negotiated instrument, and so the transferee “must account for possession of the unindorsed instrument
by proving the transaction through which the transferee acquired it.”


A tale of two housing markets: mansions for the rich while poor are priced out

As President Obama prepares to address housing and the middle class in the State of the Union, he faces one big challenge: why the housing market is only recovering for the rich as builders break ground for more McMansions.

The median net worth for Americans is a paltry $45,000. Income growth has stagnated for everyone except the highest earners at the very top.

Guardian Consider this incredible statistic from the research analyst Redfin: through last April, sales of the McMansions of America – the top 1% of homes by price – rocketed up 21% compared to last year. But sales of the other 99% of homes were down 7.6%. 

Here’s the real problem with mortgages: the broad majority of people just don’t have the money to afford a house. (They lost it all to mortgage industry crimes, and instead of being justly compensated through fines and settlements, the state and federal governments kept the money. MSF)



How would you feel if even though you were making regular monthly payments, your mortgage bank sold your house? This may seem like an odd question, but this type of situation happens every day in financial markets in a practice known as rehypothecation.

Cyril Monnet
 professor of
economics at
the University of Bern in Switzerland
It is more difficult to see why a borrower
would consent to this practice: The
borrower must take into account the risk that the lender will not return his collateral when the borrower repays his loan. This risk is amplified when the borrower has consented to rehypothecation.


Will the banks and title companies criminally forge more documents to remedy the tainted titles?

Four Banks Reach $2.7 Million Settlement With Massachusetts AG Over Foreclosure Violations

Mass. AG Bank of America, Citi, JPMorgan Chase, and Wells Fargo were accused of violating Massachusetts foreclosure laws and the Massachusetts Consumer Protection Act by foreclosing on properties in the Commonwealth when they did not hold the rights to the mortgages, and therefore did not legally have the right to foreclose.
In addition to paying the monetary penalties, the four banks will undertake obligations to facilitate the repair of defective property titles. 


S&P's Settlement With the SEC Isn't the End of Its Problems

Bloomberg S&P is close to a separate settlement of about $1 billion with the Justice Department. That deal would address allegations that the company misled investors about ratings of residential (as opposed to commercial) mortgage-backed securities before the 2008 subprime-driven Wall Street crisis. 


Merry Christmas

U.S. Foreclosure Starts Rise to 17-Month High in December

NMP The list of states with increased activity in the last months of 2014 includes those with judicial foreclosure backlogs such as Massachusetts, New Jersey, Pennsylvania and New York. Nevada is also on the list and is not a judicial state, but still has a substantial pool of seriously delinquent mortgages relative to the years before the housing crisis.”


Ocwen's Erbey Gets $1.2M in Cash After Departure

Mortgage Servicing News Erbey will receive $725,000 as a severance payment, $475,000 in lieu of relocation benefits, and lifetime health insurance for himself and his spouse, Ocwen Financial said today in a regulatory filing. He’ll also get a $725,000 dividend from his preferred stake in Ocwen Mortgage Servicing before the firm repurchases the holding for $100.

Citigroup’s $150 Million in Currency Losses Deserve a Closer Look

Pam Martens Wall Street on Parade After blowing up in spectacular fashion in 2008, receiving the largest taxpayer bailout in the history of modern finance, Citigroup’s FDIC-backed bank, Citibank N.A., is allowing retail customers around the globe to gamble in the high-risk world of currency trading with leverage as great as 50 to 1.


Altisource Adds Chief Revenue Officer to Ease Reliance on Ocwen

Who better to hire for your criminal organization than someone with a history of working with other criminals.

Mortgage Servicing News Prior to joining Equator in 2010, John Vella was the executive vice president responsible for special servicing for other parts of the criminal enterprise such as GMAC/Rescap and before that, was CEO of EMC Mortgage Corp., a lending division of Bear Stearns that was acquired by JPMorgan Chase in 2008.

Ocwen's Altisource Spinoff Fires 800 as CEO Pleas for Calm

Mortgage Servicing News Altisource Portfolio Solutions served notice to over 800 employees and several hundred more contractors as part of an effort to reassure shareholders whose stock has plunged this week.

Nearly all the cuts were made this week at offices spanning from Boston to India, where several hundred personnel tied to the mortgage technology and outsourcing company were let go


From our case archives:

Copy of the Note is Not Enough


COA of Texas 8th Dist. El Paso We have judgment being granted solely on the pleadings, with a "copy" of a note a part thereof. That is not enough.

He was faced only with pleadings -- no proof... pleadings alone will not raise a fact issue.


Court Grants Waiver of Supersedeas Bond

Goebel v. Wells Fargo

COURT OF APPEALS FOR MONTGOMERY COUNTY, OHIO Banks like to further burden homeowners by demanding they post a bond.

"Goebel and Powell moved to stay the sheriff’s sale, with a request for waiver of the supersedeas bond. On May 29, 2014, the trial court granted the motion."


The Beauvais decision distinguished the 4th DCA decision, and explained that when a prior dismissal is with prejudice, it operates as an “adjudication on the merits” and thus destroys any issue as to acceleration and thus use of the statute of limitations defense.

Foreclosure Defense Nationwide By contrast, when the prior dismissal is without prejudice, the prior acceleration is preserved and keeps the statute of limitations clock ticking.

This has a direct effect on the thousands of cases previously filed by David Stern which were left in limbo when his Firm closed years ago. Many other Firms have since picked up “old Stern files” which were dismissed without prejudice due to, e.g., lack of record activity, but which filings contained an acceleration. These cases are prime targets for use of the statute of limitations defense for foreclosure cases

A Comparison Study of Prosecution of Bank Fraud vs. Prosecution of Unarmed “Suspects” in America

Remember HSBC getting to pay a fine for money laundering drug cartel money, and the executives kept their handsomely paid jobs?), the banks don’t have to admit any liability, they can pay in all sorts of creative ways that amount to more government (aka taxpayer) subsidies and bailouts, and scant resources reach the homeowners actually affected by the harms.

Findsen Law We have posted extensively on the lack of criminal accountability for the masterminds of the financial crisis, the crisis “profiteers” and engineers. Save Lee Farkas, former CEO of Taylor, Bean & Whitaker, almost no financial executive has been indicted. Instead, our “mortgage task forces” have turned to the “street level pushers,” prosecuting borrowers for so-called liar’s loan, despite scads of evidence that the Countrywides and EMCs of the era were filling in income FOR the borrower after phone interviews, bank-owned brokers were inflating income figures to originate any loan that could help fill the securitization machine, and badly underwritten loans were knowingly put into mortgage-backed-securities, often with the issuing bank taking the opposite side of the trade on the side, via credit default swaps, or shorting CDOs. 


Banks MUST Comply with HUD Regulations to Foreclose

Weidner Law Banks are routinely arguing that they can ignore their requirements to engage in pre-foreclosure obligations provided by HUD….but here are their instructions:


Your Home Is Your Prison: How to Lock Down Your Neighborhood, Your Country, and You

Alexander endured three years of jail time and a year of house arrest while fighting off a prison sentence that would have seen her incarcerated for the rest of her life — all for firing a warning shot that injured no one to fend off her abusive husband.

naked capitalism Like many black women before her, Alexander was framed as a perpetrator in a clear case of self-defense. 

In November, as her trial date drew close, Alexander accepted a plea deal that will likely give her credit for time served, requiring her to spend “just” 65 more days in jail. Media coverage of the development suggested that Alexander would soon have her “freedom,” that she would be “coming home.”


Fed Testimony in AIG Bailout Trial: If It Walks Like Perjury and Quacks Like Perjury…

naked capitalism One of the most striking things about the testimony in the AIG bailout trial is the degree to which Fed officials play fast and loose with the truth. And I don’t mean the normal CEO version of having no memory of events that are inconvenient and very detailed recollections of things that boost their case. I mean statements that are flat out false.


Stress mounting on ‘do-or-die’ Citigroup

“Either Citi gets it done or it’s time to more aggressively break up the company,” Mike Mayo, a banking-industry analyst at brokerage firm CLSA

NY Post Citi has flunked the test twice in the past three years, and insiders say Chief Executive Michael Corbat probably can’t survive another failure. The bank submitted its paperwork earlier this month and should get results in mid-March.
Stress tests are annual exams in which 31 large banks forecast how much money they could lose in a serious economic downturn.


Slimin’ Jamie Dimon Tells Howlers About Persecution of Banks, “Fortress Balance Sheet”

naked capitalism Jamie Dimon seems to think if he can tell his Big Lies long enough, he’ll be believed. 

Dimon’s latest opportunity to play Ministry of Truth came in an analysts’ call last week, when he tried presenting JP Morgan and banks generally as “under assault”. This was so patently ridiculous that it quickly elicited the scorn it deserved. 


Jamie Dimon says JPMorgan needs to ‘stop stepping in dogs–t’

The fact is, some shareholders have tired of Dimon, with the stock falling 4.9 percent from Wednesday’s close.

NY Post A longer look shows JPMorgan has been off its game for some time, as seen in the London Whale episode (in which the bank lost some $4 billion of its own money, shareholder money) and paying $13 billion to the Justice Department in 2013 for its “role” in the “subprime crisis.”


Foreclosures drop, but 'zombie' properties remain

Sun-Times Hector Reyes could probably write a book on the nightmares of fighting foreclosure.

It would include unexpected financial hits, unsuccessful pleas to the bank to renegotiate a mortgage, bad advice, a battle for loan modification, and scam attorneys.


Pleading Requirements in Foreclosure Cases. To Attach or to Allege, that is the Question.

The issue in this case is whether Freddie Mac v. Schwartzwald requires a plaintiff to attach evidence of standing to the complaint, or whether it is enough for the plaintiff to prove the standing alleged in the complaint through sufficient evidence provided at a later stage of the proceedings.

Legally Speaking Ohio Rule 10 (D)(1): Account or written instrument. When any claim or defense is founded on an account or other written instrument, a copy of the account or written instrument must be attached to the pleading. If the account or written instrument is not attached, the reason for the omission must be stated in the pleading.

The problem is many cases go on for years before the concealed truth is discovered that the plaintiff never owned the loan. - MSF


The Loans Never Made The Trusts – It’s All In The HMDA Data!

Now it’s time for the “banksters” to fall on their own swords. You see, there is this federal law called the “Home Mortgage Disclosure Act” (HMDA) that’s been around since 1975. You can read the highlights here:

BPIA So even if the “phantom trusts” did in fact exist, they never received any tax ownership of the assets per the admissions in the HMDA data (at least in the WaMu 2007 trust cases I’ve reviewed thus far.) If this fact pattern exists across the board, as I believe it likely does, the ‘banksters” may have just fallen on their own swords.


Should Jamie Dimon Be Criminally Prosecuted?

If you are not reading the free book offered on-line, a chapter per month, called “JPMadoff: The Unholy Alliance Between America’s Biggest Bank and America’s Biggest Crook,” you are missing out. This book is among the best commentary on contemporary American life that I have ever read. And it’s free, for heavens sake!

Forbes Chapter 6 of the Chaitman/Gotthoffer book lays out, for all of us to comprehend, the outrageous conduct of officers of JPMorgan Chase — including Jamie Dimon — relating to the London Whale. If you take pride in being well-informed, you have to read this chapter. I guarantee that, once you do so, you will be asking yourself: “Why didn’t someone go to jail for this?” That’s a question the authors have anticipated; they answered it in an prior chapter, Chapter 3.



JPMadoff: The Unholy Alliance between America’s Biggest Bank and America’s Biggest Crook

Helen Davis Chaitman and Lance Gotthoffer The authors, Helen Davis Chaitman and Lance Gotthoffer, are among the nation’s top litigators and their experience and expertise is obvious as they explain how the Obama administration has left this country in a moral vacuum with its policy of not enforcing the criminal laws against this country’s biggest criminals. One hundred years from now, historians will look back upon this period in our history and ask: What was Obama thinking? In his administration, if you are a petty thief, you go to prison in a police van. But if you are a big-time crook, you go to Greenwich every day in your limousine.


MERS Assignments VOID

This tells the story in the shortest amount of time. 

This case slams Aurora, who was and remains one of the worst offenders in the category of fraudulent foreclosures. 


Living Lies The Court decided that since the basis of the claim was an assignment from MERS who had no interest in the debt, note or mortgage, there were no “successors.” This logic is irrefutable. 

The strategy of moving to strike affirmative defenses is meant to cut off discovery to the point where no defenses can be raised or proven. And cutting off discovery is what the foreclosers need to do or they will face sanctions, charges of fraud, perjury and worse when the real facts are revealed.


Owensboro, Ky., Prepping Mass Foreclosure Action

Mortgage Servicing News If this latest foreclosure program goes like the last, the city could end up buying lots for a pittance. In 2013, toward the end of the process, the city purchased seven residential lots, six of them for a total of $9, at the foreclosure sale.


Court of Common Pleas

Lorain County, OH

If the debt involves a mortgage, the complaint, counterclaim, or cross-claim has attached to it: (1) a legible copy of the mortgage, and (2) the mortgage is signed and properly acknowledged, and
these names match the names in the granting clause, and (3) the mortgage is recorded. 

REITs Emerge as Saviors for "Misfit" American Borrowers

Bloomberg REITs, facing a decline in yields from government-backed mortgage bonds, are seizing the opportunity to serve these borrowers and boost profits. 



PHH has so far given me the runaround on a modification that includes a principal reduction. My home never was worth anywhere near $300,000 and I couldn’t even sell it now for a fraction of that. Fraudulent appraisals and predatory loans have devastated my neighborhood, where in just 3 blocks there are nearly 30 vacant homes. 

Occupy Our Homes “In my 35 years practicing law, I have never seen such carnage leveled at whole communities of working people,” says Michelle Munsat, the lawyer representing Clifton Beckley. “It is clear that the banks and other money lenders are directly responsible for this, as they continue to make record profits while from throwing families out of their homes. Here in New Jersey, blame must also be shared by the State Legislature and the Governor's administration which continue to fail to enact measures to protect homeowners like Mr. Beckley.”

More banks targeted for mortgage securities fraud: NY attorney general

Reuters New York’s top law enforcement official said he plans to help bring more fraud cases against the world's biggest banks for selling shoddy mortgage-backed securities before the 2008 financial crisis.



Former Title Agent Admits Role in Multi-Million Dollar Mortgage Fraud Scheme

The wire fraud conspiracy charge to which Nowak pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss resulting from the offense.

Bergen Dispatch The owner and operator of A.N. Title Agency LLC and was an agent for Stewart Title Guaranty Company. Nowak had a duty to review a property’s title to determine ownership and the existence of any prior liens and truthfully disclose them in the title insurance documents. She also had a duty to issue title insurance policies to lenders guaranteeing there were no other liens so that they would be first in line to have the property sold if the borrower stopped making mortgage payments. Nowak also acted as a settlement agent and was required to disburse loan money in accordance with lender instructions, pay off any existing liens and record loan documents in the appropriate county clerk’s office.


A Pattern of Conduct at Ocwen and Other Players in the Foreclosure Frenzy

If you look at Select Portfolio Servicing, formerly Fairbanks Capital, (and now owned by Credit Suisse) you will see that they were guilty of fraudulent servicing practices as far back as 2003

Living Lies In a recent case where Patrick Giunta and I represented the homeowners the court found that there was no authority of the servicer and no loan transfer to the alleged Trust. The Judge specifically expressed her displeasure with the obvious indications of backdating and fabrication of endorsements, assignments and the attempt at using Powers of Attorney that were a fabricated work-around.
Any “presumption” rebuttable or otherwise, should not be allowed regarding any paperwork that is produced by these players. 


Rhode Island Supreme Court: Homeowners have standing to challenge assignments.

DiLibero v. MERS

Plaintiff executed a note payable to New Century Mortgage Corporation. The note was secured by a mortgage on the property naming Mortgage Electronic Registration Systems, Inc. (MERS) as mortgagee. New Century, the lender, subsequently filed for bankruptcy and filed a notice of rejection of executory contract regarding its membership agreement with MERS and its status as a MERS member. 

Rhode Island Supreme Court MERS then assigned the mortgage to UBS Real Estate Securities, and UBS assigned the mortgage to USA Residential Properties. Thereafter, USA Residential and its loan servicer, Rushmore Loan Management Services, LLC, commenced foreclosure proceedings against Plaintiff. Plaintiff filed this complaint against MERS, UBS, USA Residential, and Rushmore, declaring that the mortgage assignments were void and the foreclosure sale was invalid. The superior court dismissed the action for failure to state a claim, concluding that Plaintiff lacked standing to challenge the assignments of the mortgage. In Mruk, we held that
homeowners in Rhode Island have standing to challenge the assignment of mortgages on their homes to the extent necessary to contest the foreclosing entity’s authority to foreclose.


Ex-lawyer sentenced to 45 years prison in eviction slaying

A former lawyer has been sentenced to 45 years in prison for fatally shooting a handyman during an eviction at a Miami Beach condominium.

NBC A judge imposed the sentence Tuesday on 48-year-old Joseph Richer, who was convicted in October by a jury of second-degree murder in the 2010 killing of Carlos Alberto Gomez Castellanos. Evidence showed the handyman was accompanying a police officer during an attempt to evict Richer from the beachfront condo.



Plaintiff filed a complaint alleging that the assignment from MERS to ACT Properties was invalid because the signer was unauthorized.

Rhode Island Supreme Court When Plaintiff filed a notice to depose a MERS designee as to the authority of the official who executed the assignment from MERS to ACT Properties, MERS moved for a protective order seeking to restrict discovery, arguing that Plaintiff had no standing to challenge the validity of the assignment. The hearing justice denied the motion. The Supreme Court quashed the hearing justice’s decision, holding that because Plaintiff merely alleged that the assignment was voidable, as opposed to void, and because she was not a party to the assignment, she lacked standing to challenge it and was not entitled to engage in discovery pertaining to the authority issue.
full post


TILA Returns With a Vengeance

Lenders became aware that they were vulnerable to huge penalties including the proverbial free house if they screwed around with the requirements of TILA.

Living Lies Then came an army of lawyers paid by Wall Street and with briefs stacked to the ceiling and assumptions on the part of Judges that no Bank with a big brand name would engage in a systemic pattern of fraud, and suddenly the TILA protections started to melt away as millions lost their homes to phantom mortgages in phantom foreclosures that were made real by misguided orders of the courts. And then suddenly the United States Supreme Court, usually bitterly divided on partisan lines came out with a unanimous decision that put TILA back as the centerpiece on the table. And everything is changing.


Ocwen's Options May Be Limited Following Calif. Threat

Mortgage Servicing News Industry observers say the embattled Ocwen would likely have to farm out its large California portfolio to a third party, disrupting its relationship with borrowers in the state and depriving it of fees and cash flow on roughly $95 billion of servicing rights.


UNANIMOUS SCOTUS: TILA Rescission Effective on Notice: No Borrower Lawsuit Required

All the decisions in all the states requiring the borrower to file suit to enforce rescission are wrong.

What effect this will have on the thousands of cases in which borrowers sent notices of rescission and were foreclosed remains to be seen, but it sure will be interesting to see what the courts do.

Living Lies But that doesn’t clear up the question of what to do about events that have long since passed. There is no statute of limitations (except perhaps adverse possession) on title defects. If the title defect exists, it is there, by law, for all time. People who have purchased property that was involved in foreclosure and where the former owner canceled the mortgage by giving notice of rescission have a built in title defect. None of the sales of such property either through forced sale in foreclosure or third party sales would be anything more than a wild deed.

Oral Argument in Wells Fargo v. Horn

Ohio Supreme Court ISSUE: Is a plaintiff required to attach to a complaint all evidence needed to show standing? 


Wells Fargo v. Horn

What Documents Must Be Attached to Complaint to Prove Standing?

Court News Ohio Mr. Horn appealed to the Ninth District Court of Appeals, which reversed the trial court’s decision and ordered the case to be dismissed. The appeals court ruled that Wells Fargo had not proven that it had standing (the right to file the suit) under Fed. Home Loan Mtge. Corp. v. Schwartzwald, a 2012 Ohio Supreme Court decision.

Wells Fargo appealed to the Ohio Supreme Court, which agreed to hear the case.



Yarborough v. Household Finance

Because the Yarbroughs contend the deed of trust and resulting substitute
trustee’s deed are void due to forgery, they have raised a genuine issue of title so intertwined with the issue of possession as to preclude jurisdiction in the justice court. 

Texas 14th COA In an issue of first impression, we must decide whether an affirmative defense of forgery, supported by an affidavit alleging that the defendants’ signatures on a deed of trust were forged, raises a genuine issue of title intertwined
with the issue of possession sufficient to deprive a justice court of jurisdiction in a forcible detainer action. We hold that it does. 

(“A forged deed is void ab initio and inoperative. . . . Thus, when a document is void or void ab initio, it is as if it did not exist because it has no effect from the outset.”); 1st Coppell Bank v. Smith, 742 S.W.2d 454, 457 (Tex. App.—Dallas 1987, no pet.) (“A forged deed, or deed of trust, is void, and does not pass title to land.

from 3/18/11

Aurora Loan v. Veatch

Aurora’s interest in the property is dependent upon the forged deeds made to Antonio Simpson. As the trial court noted, such a deed cannot convey title. “[A] forged deed is a nullity and vests no title in a grantee. [Cit.] As such, even a bona fide purchaser for value without notice of a forgery cannot acquire good title from a grantee in a forged deed, or those holding under such a grantee, because the grantee has no title to convey.”

Supreme Court of Georgia Brock v. Yale Mortgage Co., 287 Ga. 849, 852 (2) (700 SE2d 583) (2010). In that opinion, this Court specifically overruled prior precedent of this Court that extended “the bona fide purchaser for value doctrine to those acquiring title under a grantee in a forged deed.” Id. at 853 (2). Accordingly, it is of no moment whether the deed records provided notice of the forgeries at the time Matthews executed the security deed on which Aurora bases its claim; there was simply no title held by Simpson, Matthews, First Magnus Financial Corporation, or any subsequent assignee.

RICO — Fraudulent Mortgage Assignment and Fraud on Court in Bringing Mortgage Action, Not Underlying Default on Mortgage, Caused Injury in Form of Attorney's Fees, Sustaining RICO Action

This case relates to alleged misconduct in a separate state-court foreclosure action. The law firm of Lerner, Sampson & Rothfuss (LSR) filed that foreclosure action against Rick Slorp on behalf of its client, Bank of America.

Joseph Hage Aaronson LLC (UK) Because Countrywide had originated Slorp's mortgage, LSR attached to the complaint an assignment purporting to assign an interest in Slorp's mortgage to Bank of America. The state court awarded judgment to Bank of America. Slorp subsequently retained counsel who questioned the assignment's validity, and he sought to depose Shellie Hill, the LSR employee who had executed the assignment on behalf of Mortgage Electronic Registration Systems, Inc. (MERS). Bank of America promptly dismissed the foreclosure action, and the state court vacated its judgment.


Supreme Court clarifies rules for rescinding mortgages


Yahoo! Finance


A unanimous Supreme Court ruled Tuesday that home buyers don't need to file a lawsuit, but may simply write a letter if they want to back out of a mortgage because they claim their lender violated the federal Truth in Lending Act.


California Moving to Suspend Ocwen’s Mortgage License

MReport The LA Times reports that California's Department of Business Oversight is moving to halt Ocwen's operations in the state after the company failed to provide documentation about its compliance with California's Homeowner Bill of Rights. The bill, which went into law at the start of 2013, prohibits certain mortgage servicing practices—such as dual-tracking—and sets in place requirements for single points of contact and document verification, among other provisions.


Hearsay: Those “Business Records” Are Not Really Admissible Into Evidence

In most cases now, thanks to the shell game of switching servicers, trustees and other parties, the testimony from such a witness is hearsay on hearsay because they are talking about records produced at another company or organization.

Living Lies it is necessary that someone with personal knowledge testify how the data was recorded, when it was recorded, by whom it was recorded (i.e., by a person with actual knowledge of what was being recorded), and whether it was done “at or near the time of the event” in conformity with the set procedures of the party (i.e., in the regular course of that company’s business). As Holtmakes clear, relying upon the mere existence of records within a computer system renders it virtually impossible to meet the business records exception requirements.


Corporate Recidivism? Ocwen's Charter Problems

Last month mortgage servicer Ocwen (that's NewCo backwards) was mauled by the NY State Department of Financial Services. Now the California Department of Corporations is seeking to revoke Ocwen's license to do business in that state. 

Prof. Adam Levitin Here's the thing that is often forgotten: this ain't the first time! Ocwen used to be a federal thrift. In 2005, however, Ocwen "voluntarily" surrendered its thrift charter in the face of predatory lending/servicing investigation. And here we are, a decade later. What's changed? By the NY and California allegations, not much. In other words, we're looking at a potential case of corporate recidivism. I'll refrain from commenting on the merits of the allegations, but there should be zero tolerance for corporate recidivism. 


Banks Rejected by U.S. High Court on Mortgage Securities Suits

Bloomberg The U.S. Supreme Court dealt a blow to Royal Bank of Scotland Group Plc and Nomura Holdings Inc., refusing to derail federal government lawsuits that seek billions of dollars over the sale of risky mortgage-backed securities.


State's biggest law firm settles bank-failure dispute


When the borrower stopped paying the loan, the bank was unable to foreclose on the property, which was worth at least $4.6 million at the time, according to the lawsuit.

Herald Tribune FLORIDA'S LARGEST LAW FIRM has paid $250,000 to settle a lawsuit filed by the Federal Deposit Insurance Corp. tied to the failure of Peninsula Bank of Englewood.

The FDIC accused blue-chip law firm Akerman Senterfitt LLP of legal malpractice and professional negligence for failing to adequately represent the bank in a soured loan deal.


Mortgage Broker Sentenced to Five Years in Prison for Defrauding Lenders 

60 months of imprisonment, to be followed by five years of supervised release, on his conviction of conspiracy to commit wire fraud and bank fraud.



The conspiracy involved the submission to lenders of loan applications that contained material misrepresentations about the borrower’s financial condition, such as inflating the borrower’s income and assets, and appraisals that overstated the values of the properties serving as collateral for the loans. Stromberg and others also submitted false supporting documentation for the misrepresentations contained in the applications.

MUST Listen!

Exclusive Tell-All Interview With Retired Big Five Bank Executive

Foreclosure Hour Gary Dubin's guest is one of the architects of MERS. "It was all meant to help the banks and not the homeowners. We get paid to do loan modifications and NOT approve them. We had to let some go through so it didn't look like a total scam.


Opinion focuses on the failures of a pro se litigant

COURT OF APPEALS OF THE STATE OF WASHINGTON Because the Brysons cannot demonstrate any set of facts, consistent with their complaint, that would impose an obligation on the former trustee of a deed of trust to provide the debtor with an accounting, we affirm.


Obama Lied About His Intent to Prosecute Wall Street Banksters


Global Research Privately, Obama had told Wall Street executives that he would protect them. On 27 March 2009, Obama assembled the top executives of the bailed-out financial firms in a secret meeting at the White House and he assured them that he would cover their backs; he promised “My administration is the only thing between you and the pitchforks”.


“Slap in the Face” Award: The Email That Cost Big Banks $36 Billion

The total loss from the garbage products these firms knowingly sold to their investors was $128 billion. Billion!

InvestmentU Fines of $36 billion seem pretty reasonable when you consider how much the company literally stole from people.

These scumbags cost a lot of people everything they had. Savings and retirements down the drain because these mortgages should have been left on the sidelines.

JPMorgan Said to Pay $500 Million to End Mortgage-Bond Suit

Bloomberg JPMorgan reached a preliminary settlement to pay $500 million to resolve a lawsuit over $17.6 billion of faulty mortgage-backed securities issued by Bear Stearns.


Kicking Dodd-Frank in the Teeth

Gretchen Morgenson

NY Times

The 114th Congress has been at work for less than a week, but a goal for many of its members is already evident: a further rollback of regulations put in place to keep markets and Main Street safe from reckless Wall Street practices.


Ocwen facing ‘legal actions’ after admitting internal problems

The embattled mortgage servicer could face an onslaught of “legal actions” from state and federal regulators this year.

NY Post The settlement was a dramatic conclusion to a two-year investigation led by DFS Superintendent Ben Lawsky into unfair business practices, which included backdating letters to distressed mortgage holders, self-dealing within the related companies and pushing homeowners into foreclosure.

Collins v. Experian

The Eleventh Circuit CoA held that a consumer's credit report need not be published to third parties in order for a consumer to be entitled to actual damages under § 1681i(a) of the Fair Credit Reporting Act

The Eleventh Circuit COA Alabama "Thus, by its plain terms, § 1681i(a) does not require communication to a third party; it provides a consumer reporting agency violates that provision if a consumer notifies the agency there is inaccurate information contained in his file and the agency does not conduct a reasonable reinvestigation into the matter. A file is simply the information retained by a consumer reporting agency. Thus, we hold that the plain language of the FCRA contains no requirement that the disputed information be published to a third party in order for a consumer to recover actual damages under § 1681i(a)."


Pleading Wrongful Foreclosure

Cases in which the bank blocked the sale or refinance of the property, or unilaterally tried to avoid a modification, or where the borrower was in fact current when actions by the bank forced the borrower into the illusion of default are the best cases, in my opinion, for a wrongful foreclosure.

Living Lies The grounds upon which these cases are decided in favor of the homeowner vary widely. Some decisions show that the acts of the banks were committed with full knowledge of what they were doing and that they were playing a shell game on the court and on the borrower. Those cases seem more conducive for fraud or spurious litigation or wrongful foreclosure.

Let the fraud begin.

Kofax Launches E-Signature Software

Mortgage Servicing News Kofax, a financial technology company in Irvine, Calif., on Thursday released a product that allows lenders to capture and process electronic signatures.

The software, known as SignDoc Enterprise, gives consumers the ability to sign and return documents from desktop or mobile devices.


Alleged $110m mortgage fraud may have been inevitable

Ballast chief executive Frank Paratore said loan fraud has become increasingly sophisticated and can be hard to detect if spread over multiple banks and repayments get made.

The Advisor (Australia) “The banks are running on automated systems and the only reason they can provide the turnarounds and service that they provide is because of these automated systems,” he said.

“Not every deal is going to have manual intervention – and even then, if you’ve got documentation that on face value marries up, how are you going to know that it’s falsified?”

The banks will lawyer-up and try to blame the lowest common denominator, who can’t defend themselves,” he said.


You Won't Believe What Decided the Fate of Foreclosure Cases at the 4th DCA

Will botched paperwork affect the outcome of foreclosure appeals? It depends on the judges.
Attorneys say the decisions may further complicate already-lengthy and expensive foreclosure litigation.


supplement by MSFraud

"Normally you see discrepancies of this nature within different circuits. But what we're seeing in the Fourth is discrepancies among themselves," said foreclosure defense attorney Roy Oppenheim of Weston. "It just makes this more complex. When there is cloudiness, it just creates more ambiguity and delays the conclusion of the foreclosure mess. In the end it doesn't help anybody when you have inconsistent rules."


Quantum of Justice: Doug Boggs, the Foreclosure Crisis and the Truth "Right In Front Of Our Eyes"

We live in a twilight zone where fraudsters are paying their way out of jail through countless settlements for the biggest financial heist of our generation. Every week, we read about some new bank settlement to cover up further investigation into mortgage backed securities fraud, while homeowners are still losing their homes through the very same fraudulent foreclosures that the banks and government continue to settle for. 

Occupy Amid all this, some homeowners realized early on that they must stand up and fight for justice on their own, since those responsible for protecting our justice system aren't doing their jobs.

I heard about a couple in Florida that got foreclosed on, even though they had paid cash for their home decades before. I heard similar cases in other states – homeowners being foreclosed while being current on their mortgage, foreclosed by the wrong banks, etc. The question wasn't about WHY a party was being foreclosed on, but became a question of HOW a party gets foreclosed on. 

What about the thousands of illegal foreclosures?

Debt Buyer Faces Fine and Loss of Thousands of Court Judgments

DealBook The Encore Capital Group is expected to vacate 4,500 court judgments and pay a $675,000 fine to New York State over concerns that it filed thousands of flawed debt collection lawsuits against residents.

To obtain payments on some of that debt, buyers like Encore Capital often turn to the courts in a practice that some state authorities say effectively turns the civil court system into a debt collection arm.


Modification Offers Are Enforceable Contracts

In sum, Wells Fargo made an offer, the Neils accepted that offer, and there was sufficient consideration to create a
modification of the contract. We therefore vacate the dismissal of the Neils’ claims and remand for further proceedings consistent with this opinion.

Living Lies We have all seen it, heard and experienced it over and over again. In this case Wells Fargo offered a “temporary” modification, it was accepted and the trial payments were made. Wells Fargo said the modification offer and acceptance lacked consideration — the height of arrogance since they have no transaction with consideration supporting their claim of ownership of the debt, note or mortgage.

Neil v. Wells Fargo


90% of Mortgaged Residential Properties Have Equity

And the banks want it all. - MSF

Mortgage Servicing News Texas had the most properties in an equity position, at 97.4%, followed by Alaska (97.1%), Montana (97.1%), Hawaii (96.4%) and North Dakota (96.1%).


One in seven Detroiters threatened with eviction in wave of home foreclosures

WSWS Poor residents who were as little as $150 behind on their water bills were shut off immediately, while major corporate customers owing tens or even hundreds of thousands of dollars, including GM and Chrysler, were not shut off. Both the water shutoffs and foreclosures are part of a long-standing plan to “downsize” Detroit by shutting off essential public services to entire neighborhoods deemed to under-populated or poor for commercial investment.


Delinquent Property Tax Collection: Dancing Around the Automatic Stay

JDSupra After reopening a bankruptcy case, a mortgagee moved for a determination that a post-petition delinquent property tax sale was void because it was held in violation of the automatic stay. In response, the tax authority requested retroactive annulment of the stay.


Judge dismisses challenge to Shelby Township condominium foreclosure

Michael Balian, attorney for the late Rosemary Heidenfelder, who died in November at 85, said he isn’t happy that the court challenge to the sale was rejected. He previously called the foreclosure maneuver “morally repugnant.”

Heidenfelder’s condo was placed in foreclosure in 2013 because she did not pay a $342 repair bill that she said she didn’t know about and would have gladly paid.

Macomb Daily “Circuit court is a court of equity,” Balian said. “To lose a $100,000 condominium for $342 is so inequitable that the judge could have set it aside.”

He questioned why the association or the management company didn’t attempt to personally contact longtime resident Heidenfelder.

The case was hindered by the fact that the process server suffered a stroke and was not available to testify, Balian said.

“Anything that could go wrong in this case did go wrong,” he said.

Heidenfelder died in her sleep in the condominium, Balian said. He would not speculate on whether the stress of the situation contributed to her death but said, “It weighed heavily on her.”


The Republican Strategy To Repeal Dodd-Frank

Simon Johnson On January 7, 2015, Day 2 of the new Congress, the House Republicans put their cards on the table with regard to the 2010 Dodd-Frank financial reforms. The Republicans will chip away along all possible dimensions, using a combination of legislation and pressure on regulators – with the ultimate goal of relaxing the restrictions that have been placed on the activities of very large banks (such as Citigroup and JP Morgan Chase).


“Phantom Lenders” – Don’t Be Afraid. They Don’t Exist Anymore!

Folks, it’s time to wake up from this foreclosure nightmare by realizing and understanding that the big bad “Lender” trying to foreclose on your home no longer exists. Rather, it’s just a figment of your imagination put there by the servicers.

The facts are gruesome, folks. The servicers have been harvesting houses as agents for principals who have no secured interests or rights to the houses. “Wake up!! It’s just a bad nightmare. There’s no such thing as ‘the big bad lender’ anymore.”

Bill Paatalo


Many states now have mediation requirements mandating that the “lender” must be present at the negotiating table. Well how can this be if the “lender” no longer exists? Or better yet, how can one negotiate a loan modification with the servicer that claims to be the agent for the “lender?”

If the servicer can only act as agent for the “lender,” to which the “lender” no longer exists, and the investors in the trust (“Phantom Lenders”) have no secured interest in the REMIC assets, who is left that is entitled to foreclose?  Lenders no longer exist. Investors and their fiduciary have no secured interests in the assets. And the servicers are only agents hired to collect the payments from the borrower to pass on to the investors. I think we’re out of bodies.


Are Fraud Claims Barred by Statute of Limitations? Credit Suisse (Owner of SPS) Loses

Credit Suisse, parent company of Select Portfolio Servicing (SPS) went up against the New York attorney general banking (pardon the pun) on the idea that the Martin Act could not be used against them for committing financial fraud because it was barred by the statute of limitations. They lost.

Living Lies The mortgage industry knows they have committed fraud, but earnestly hope they can get away with it because of statutes of limitations and statutes of repose. I know that the US Supreme Court has recently come out with some decisions that go against this idea, but I think in the long run they will not apply it to financial fraud arising from the mortgage crisis.

State of New York v. Credit Suisse



Manufactured Foreclosure: Evan Rosen Wins Trial for Client Who Never Missed a Payment

2009 case dismissed after Bank of America put on their case in chief. I never got a chance to put on our case, which would have proved that this particular client NEVER MISSED A PAYMENT. Yes, that’s right, this client NEVER MISSED A PAYMENT and was sued by Bank of America for a completely manufactured foreclosure.

Possibly best of all, was BOA’s own pay history which showed our client cured the less than $150 demanded and kept paying, even for a very long time after BOA starting rejecting his payments

Evan Rosen, Esq. Our client, an attorney and former state legislator, who was chairman of the banking and finance committee, would respond, sending in proof of coverage. Most times, within a few weeks, BOA would write back saying something to the effect of, ‘whoops, you’re right and you don’t owe us anything.’ However, within a few months of writing they were wrong, they’d again ask for more money based on the same shenanigans. This went on and on for years. The last time they did this, instead of it ending with BOA sending a “whoops, I’m sorry letter,” they stopped accepting our client’s timely, full payments and filed suit. Because our client continued paying as agreed and because of Bank of America’s complete and utter disregard for the rule of law and justice.

I thought their arrogance and disregard for truth, justice or fairness was unparalleled, but I was wrong. They later surpassed themselves. Even after Bank of America and their lawyers lost, they still kept pushing to take this person’s home away based on their own fabricated default. I used to draw comparisons between the banks to the Mafia, but the Mafia has a code of honor…


Former foreclosed homeowners may be able to get money

The Trustees office has over $1 million to return to former Denver homeowners whose houses sold for more money than was owed to lenders. The money comes from proceeds at foreclosure auctions above the amount owed to lenders by former homeowners.

9News If a house was sold to a third-party investor at The Denver Public Trustee's auction, it is possible that the winning bid was for more than what the homeowner owed. This is called an "overbid" which results in excess funds. By Colorado statute, excess funds must be distributed.

The Denver Clerk's office has amounts from overbids that range from $25 to over $240,000 for over 50 people.


Allegations that Bank of America Issued Improper Tax Forms to Consumers As State Law Challenges Percolate

Forbes The bank only reported on 1098 the amount of interest paid on the modified loan, rather than that amount plus any portion of the payments on the modified loan that satisfied the deferred interest rolled into the modified loan. Those actions, according to the complaint meant that Bank of America was “systematically, knowingly and intentionally underreporting on Forms 1098 hundreds of millions if not billions” in interest.


"Unlicensed" MERS Wins Victory in Illinois Court Over Authority to Act as Mortgagee

CitiMortgage, Inc. v. Schak

DSNews The Circuit Court of the 19th Judicial Circuit Court rejected a borrower's claim that a mortgage naming MERS as the mortgagee was invalid because MERS is not licensed under the Illinois Residential Mortgage License Act. Hoffman's ruling was that MERS not being licensed under the ACT was not sufficient grounds for declaring the mortgage void and unenforceable.

Osceola County set to take on Fraudulent Foreclosures

A Florida county is about to become first county in the country to take on Fraudulent Foreclosures. 

Marie Salt


The clerk of the court is about to authorize an audit of the court's records to see if banks have used faked documents to take people's homes.

"A certain amount of foreclosures are legit. But for the most part - they are not," said forensic auditor adding "They are fabricating documents to give the illusion that they are the true owners of the Notes." 



Foreclosure Auctions in 2014, A Very Disturbing Set of Numbers

$90,106,678.88 in Money Changing Hands
$1,431,457.48 in Clerk Fees
$2,969,453.20 in Documentary Stamps 

Weidner Law Of the 5767 auctions held in 2014, 4600 of those homes went back to the Plaintiff
The reason this number is so important, and so disturbing is it reveals that the end product of the vast majority of foreclosures is not a home that makes its way into the private market, with the private market determining what the true value of that home is. No, the disturbing reality of foreclosure auctions across this state is that those auctions are manipulated and improperly controlled by the plaintiffs who are conspiring together to engage in systemic bid-rigging.


The Lies And Perjury in Foreclosure Cases

The Legal Fiction of the Robo - Testifier

The Plaintiff has therefore failed to carry its burden of proof to present sufficient admissible evidence entitling it to the equitable remedy of mortgage foreclosure. As such, the Court grants the Defendants’ motion for involuntary dismissal. 


The Court finds that the Plaintiff’s witness does not meet the legal definition of a custodian of records, nor does she otherwise qualify as a person with the requisite knowledge with respect to the business activities of the breach department and mail room to authenticate the breach letter for the purposes of establishing that the Plaintiff complied with the pre-suit notice requirements of paragraph 22 of the mortgage.



Living Lies The note and mortgage were fatally split; and the note itself was destroyed physically because its terms became irrelevant to the obligation owed to the real creditor. Hence it is impossible to be a holder in due course or a party entitled to enforce (HDC or PETE) on a mortgage loan that was either originated or “transferred” (always without consideration) within the context of a securitization scheme.

Sept. 2014

Cashmere Valley Bank v. Department of Revenue

The court found that a REMIC investor has “no direct or indirect legal recourse” against the underlying mortgages. And, that the investor’s rights to payment were simply contractual with the investor lacking authority to force a foreclosure and not necessarily entitled to recoveries from a foreclosure.

Washington State Supreme Court Similarly, agency REMICs, like the Fannie Mae REMIC Trust 2000-38, guarantee payments even if mortgage borrowers default, regardless of whether the issuer expects to recover those payments. Moreover, the assets held in a REMIC trust are often MBSs, not mortgages. So, if the trustee defaults, the investors may require the trustee to sell the MBS, but the investor cannot compel foreclosure of individual properties.



Oral Argument Preview: More Procedural Issues on Standing in Foreclosure Cases. 

Wells Fargo's brief

Horn's brief

Why should an innocent person be forced to bear the expense and hardship of frivolous litigation by a plaintiff who lacked standing to file the action? Now the defendant has damages due, in part, to the court's failure to require the plaintiff meet its burden of proof. - MSF

Legally Speaking Ohio On January 14, 2015, the Supreme Court of Ohio will hear oral argument in the case of Wells Fargo v. Horn. The issue in this case is whether Fed. Home Loan Mtge. Corp. v. Schwartzwald requires a plaintiff to attach evidence of standing to the complaint, or whether it is proper for plaintiffs to clarify standing through sufficient evidence provided at a later stage of the litigation.

Horn appealed pro se, but did not raise the issue of standing. The Ninth District Court of Appeals reversed, deciding sua sponte that Wells Fargo had failed to demonstrate standing under Schwartzwald because it had not attached “documents evidencing a merger or name change” to the complaint. The appeals court ordered the case be dismissed without prejudice.


More False Claims Act Lawsuits Lie Ahead

National Mortgage News FHA has become increasingly aggressive in bringing such claims, which had traditionally been used only in some of the more egregious situations. Now, as a result of certain court decisions, the government has even more latitude in pursuing FCA and related claims against lenders.


RBS Said Settling Mortgage Probe

Bloomberg The lender is bracing to settle Federal Housing Finance Agency accusations it sold faulty mortgage bonds to Fannie Mae and Freddie Mac from 2005 to 2007, said the person, who asked not to be identified because the talks are private. RBS could pay a fine of as much as $8 billion.


Full Post

Arizona Supreme Court Gets it Right on Deficiency



Living Lies Two newly released Opinions by the Arizona Supreme Court. They say the borrower and guarantor are entitled to credit for the actual fair market value — not the value of the bid or any other formula. This could change 1099 tax forms filed, as well as attempts at collecting improper amounts for deficiencies. But note that many states, including Arizona, say that if the action is nonjudicial, there is no claim for deficiency anyway. If that is true in your jurisdiction, then ANY attempt to collect the deficiency might be an FDCPA violation entitling you to monetary damages.


U.S. Settles With Golden First Mortgage on Violations of DE Lender Program

nmp “This settlement holds Golden First Mortgage and its owner, David Movtady, accountable for lying to the Government about compliance with HUD requirements and approving bad loans,” said Bharara. “This type of conduct costs the United States millions of dollars when the loans inevitably default, and this Office is committed to snuffing it out.”


Creditors CANNOT Contact Consumers!

The Court finds the Defendant’s argument that the Plaintiff was merely receiving courtesy copies of the same communications that were being sent to Counsel is without merit. 

Weidner Law The whole purpose of retaining Counsel is to avoid communication between the debt collector and the Plaintiff so that she can be protected by virtue of the fact that any future communications would be sent to her Counsel. As such the Court finds the Plaintiff’s Motion for Summary Judgment to be well taken and will be granted as to Counts 2, 3 and 4.
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